Iwata on QOL pricing model, believes it has a lot of financial potential
Posted on November 6, 2014 by Brian(@NE_Brian) in General Nintendo, News
We received a bit more information about Nintendo’s “Quality of Life” plans last week. However, there’s still quite a lot of information shrouded in mystery – such as what Nintendo’s plans are when it comes to pricing.
Nintendo president Satoru Iwata didn’t share too many details on this front at the company’s financial briefing last week, but during the Q&A, he hinted at a subscription-based model. Iwata also commented on how QOL “has the potential for Nintendo to create a significantly large market that no one has ever set foot in”.
As usual, continue on below for Iwata’s full comments.
First, the launch schedule for the QOL business has not changed from what I explained at the last Corporate Management Policy Briefing. The business will kick off in the fiscal year ending March 2016, and we expect it to contribute to our financial performance in the fiscal year ending in March 2017. In the slide I showed you today, I specifically wrote the year “2016” instead of “2015” because this is the year the QOL business will be able to contribute to our financial performance. This is the timeframe we are considering for the QOL business.
Regarding the business model, we would like to elaborate when the time is ripe to explain the specific services, fees and the business model. Nintendo’s past business models have been mainly purchase-based models, but for this type of business, we understand that a subscription-based model, where companies and consumers keep long-term relationships, is more suitable. Specific details such as the initial price and ongoing fees will be elaborated on around the time we are ready to show you the actual products as well as the nature of the actual services. On a basic level, it will become a slightly different model from the past purchase-based business models.
And, as for what degree it will contribute to our financial performance, I believe it has very high potential. “Five ‘Non’ Sensing” is so interesting that it has the potential for Nintendo to create a significantly large market that no one has ever set foot in, which is the reason why we are making this new move. On the other hand, when we start any new business, we do not think it makes sense to tell you about the scale of the business before details of the business model and the pricing structure are disclosed, even though I may already have an image of it in my mind, so I will refrain from sharing any numbers today. When Nintendo began to talk about “Gaming Population Expansion” in the past, no one would have believed us if we had shown “Brain Age” and “Wii Fit,” and said that they would create a new market of this or that size before they actually started to sell. Therefore, this time, we would appreciate it if you could consider what has happened repeatedly in our history where our offerings created a very large market in the end when generally people’s initial impression was “What will Nintendo do with such a product?”
